Fears of £810bn debt timebomb

FEARS that Britain faces a ticking debt timebomb increased today as new figures showed consumers have run up a record £810bn in borrowings. The Bank of England revealed a surge in borrowing linked to the booming housing market and fuelled by the lowest interest rates for nearly 40 years.

The figures show debt rose by £9.7bn last month alone - the biggest one-month increase on record. The average Briton has now amassed a debt mountain of about £13,730.

New mortgage lending in October climbed by a record £7.9bn. Mortgage approvals - loans agreed but not yet made - also rose steeply, pointing to further strong increases in the months ahead.

Lenders say consumers are taking advantage of rock-bottom rates to swap to cheaper mortgages or unlock the rising value of their homes to finance spending, rather than using credit cards.